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StreetAccount Summary - Asian Market Recap: Nikkei (1.80%), Hang Seng (0.65%), Shanghai Composite (0.67%) as of 04:10 ET

Mar 28 ,2025

• Synopsis:

  • Asia equities ended mostly lower Friday. Further steep losses in South Korea and Japan's auto and semiconductor names leading to sharp declines on the Kospi, Nikkei and Topix while Taiwan's Taiex fell for a fourth consecutive day on chip losses. Hong Kong stocks hovered at one-month lows while China mainland boards also down again. India dipping into the red, Southeast Asia relatively outperforming but also down. Small gains for Australia as its general election was called. Bangkok suspended trading late on after strong regional earthquake, Jakarta closed for a holiday. US futures firmly lower now having been unchanged for much of the day, Europe lower in opening trades. Dollar flat, yen strengthened after Tokyo CPI data. Crude blends lower, gold at fresh record high, base metals retreating.

  • Risk-off sentiment continued Friday in Asia following President Trump's declaration of 25% auto tariffs that are set to start next week, with more losses in Asian auto manufacturer and auto part names. Technology stocks also under pressure with Samsung Electronics, SK Hynix, Tokyo Electron and Hon Hai all underperforming the broader markets and ending the week near their troughs. Globally, investors growing more alarmed at the pending 2-Apr deadline for tariffs with reciprocal measures, and subsequent retaliation from the US, still a possibly with its associated impact on inflation and growth.

  • In regional developments today, March Tokyo CPI core inflation unexpectedly rose with ex-food and energy inflation moving above 2%. BOJ March Summary of Opinions showed main focus was on US policy risks as policymakers left rates on hold. China President Xi met with global business leaders in Beijing though details of what was discussed remain scant. Australia PM Albanese announced federal election for 3-May with polls forecasting a tight race.

  • Fuji Media (4676.JP) said it has overhauled its group and television boards and appointed its CEO as new chairman. Tencent (700.HK) has invested €1.2B for a stake in Ubisoft's new European subsidiary. Nio (9866.HK) is to raise $450M for EV development via a share placement, according to exchange filings. Nippon Steel (5401.JP) has told White House officials it could invest up to $7B into US Steel from previous pledges of $2B in a bid to secure a deal. New World Development (17.HK) has pledged a prized Hong Kong real estate asset as collateral for $2B loan. The rival of one of India's two main stock exchanges, BSE (BSE.IN), NSE, deferred a plan to move derivate expiry to Monday following a SEBI review; BSE stock sharply higher.

• Digest:

  • US trading partners weigh response to auto tariffs:

    • FT discussed reactions from major US trading partners following President Trump's announcement of a 25% auto tariff. Japan Prime Minister Ishiba initially said "all options are on the table" though later directed Foreign Affairs Minister Iwaya to continue with diplomacy (Nikkei). METI minister Muto said they would have to consider countermeasures as an option while still pursuing an exemption (Kyodo). South Korea industry minister Ahn planning emergency measures as well as active engagement with US to minimize negative impacts (Reuters). European Commission president Ursula indicated plans to safeguard economic interests while also seeking resolution through negotiation. France currently the most outspoken as Finance Minister Lombard called for EU reciprocation and told France Inter radio that Brussels was working on a target list. In contrast, Mexico President Sheinbaum seeking to retain preferential US treatment and waiting for details of tariffs due next week to come to light before delivering a response. UK signaled no plans to retaliate out of concerns of escalating tensions further. Trump on Truth Social threatened "far larger" tariffs on EU and Canada if they collaborate on retaliatory measures.

  • China President Xi meets foreign business executives to boost sentiment:

    • Chinese President Xi Jinping met with global business leaders in Beijing (Xinhua) as China is making efforts to boost investor confidence amid rising geopolitical tensions and tariff uncertainties. Bloomberg reported Xi told attendees that foreign businesses are important participants in China's modernization and they are welcome to keep lines of communication open with Chinese government. Noted China's inbound investment plummeted to lowest in over three decades in 2024 as growth slowed and geopolitical tensions intensified. Beijing is sending message to foreign businesses that it is open for business, in contrast with Trump administration's "Amerca First" policies. Premier Li Qiang reaffirmed country's commitment to opening up and cooperation at China Development Forum last Sunday (Xinhua) and Vice Premier Ding Xuexiang said Beijing to further ease market access for foreign investment at Boao Forum Thursday (Reuters). President Xi's meeting with foreign corporate executives came after he met Chinese entrepreneurs last month, in which he vowed unwavering support for private businesses (Nikkei).

  • BOJ Summary of Opinions show keen focus on US policy risk:

    • Summary of Opinions for the March MPM indicated primary focus was on US developments, monitoring policy (tariff) reverberations as well as US economic growth risks. Dovish views justified leaving rates unchanged due to the ongoing fluidity of US policies and the extent of downside risks to Japan still unclear. Yet, two others pointed out that uncertainties alone would not preclude policy changes. Another suggested BOJ retains flexibility to move given Fed has indicated no rush to cut rates. One member was already looking ahead to the next hike, suggesting underlying inflation may be fairly close to the 2% target at that point, warranting consideration of options including shifting policy stance from accommodative to neutral. Furthermore, one member raised the possibility that, from the perspective of increasing expected rates of return, market participants may be viewing real rates to be lower than those implied by CPI, which may be strengthening easing effects and called for adjustments to avoid overheating in financial activities. Recall that press coverage focused on tariff uncertainties augured for dovish takeaways though economists largely saw Ueda's press conference remarks as balanced, and left their rate hike calls unchanged, concentrated around July.

  • Australian PM Albanese announces federal election for 3-May:

    • Australian PM Albanese announced federal election to be held on 3-May, kicking off Labor government's bid to win a second term (Bloomberg). In terms of policy, government has already committed billions of dollars in subsidies for GP visits and prescription drugs, funding for education and road upgrades, extension of energy bill rebates, and modest tax cuts from 1-Jul-26. In his Budget Reply speech Thursday, opposition leader Dutton confirmed plans to halve fuel excise tax (saving households with one car ~A$700-750 over the year), ramp up domestic gas supply, boost defense spending and cut migration, but made no mention of tax cuts/reform (The Australian). Latest Newspoll shows Coalition leading 51-49%, though Labor's seat margin makes it an uphill climb for the opposition (The Australian). Labor currently holds 78 seats in Australia's 150-seat parliament, compared to Coalition's 57. While Labor is slight favorite to win, political consensus based on national polls suggests they will be tipped into minority, forcing them to rely on Greens and/or independents to form government. Coalition victory seen as most market friendly outcome, while Labor-Greens alliance considered the worst given latter's policies including big tax hikes on corporate profits and property investments and blocking new mining.

  • Tokyo inflation firmer than expected as rice prices continue to accelerate:

    • Tokyo core CPI rose 2.4% y/y in March, above consensus and prior month's 2.2%, retracing much of the February moderation after electricity & gas subsidies were reinstated. Energy contributions declined a further 0.04 ppt amid lingering follow-through deceleration in electricity and gas. This was outweighed by persistent acceleration in non-fresh food adding another 0.14 ppt to the headline. Rice prices extended surge to 92.4%, contributing 0.27 ppt, following 79.4% in February. Additional drivers were household durables and accommodation. Fresh food gains eased somewhat despite a 91.2% spike in cabbage. This factor drove down goods inflation to 5.3% from 5.5%, while service inflation strengthened to 0.8% from 0.6%. Recall recent attention on elevated food price burden on cost of living. But BOJ has hinted they see the dynamic as a special factor though acknowledged the risk of a prolonged phase eventually affecting consumer inflation expectations. For specific policy signals, focus has shifted to BOJ rhetoric on underlying inflation and Governor Ueda recently mentioned in parliament they estimate the trend approaching the 2% target and a bit more to go before reaching a level consistent with the mandate.

  • Notable Gainers:

    • +11.3% 667.HK (China East Education Holdings): reports FY adjusted net income CNY525M vs FactSet CNY488M

    • +6.1% 4676.JP (Fuji Media Holdings): overhauls company and Fuji Television boards, appoints Osamu Kanemitsu as chairman

    • +5.4% 1336.HK (New China Life Insurance): reports FY results with net income attributable ahead of FactSet estimates

    • +0.4% 2331.HK (Li Ning): reports FY results with revenue ahead of FactSet estimates

  • Notable Decliners:

    • -8.7% 010130.KS (Korea Zinc Co.): Seoul Court rejects Youngpoong's injunction against Korea Zinc for permission to exercise voting rights at regular shareholders' meeting

    • -7.5% 6690.HK (Haier Smart Home): reports FY results with IFRS net income attributable below StreetAccount estimates

    • -7.1% 9866.HK (NIO Inc): 136.8M-A-share secondary priced at HK$29.46 through Morgan Stanley, UBS, CICC, Deutsche Bank

    • -6.1% 4552.JP (JCR Pharmaceuticals): cuts FY guidance; guides FY net income attributable (¥4.30B) vs prior guidance ¥2.20B

    • -5.8% 753.HK (Air China): reports FY CAS results with operating income (CNY3.43B) vs year-ago (CNY3.32B)

    • -3.6% 000660.KS (SK Hynix): finalizes acquisition of Intel's NAND and SSD businesses

    • -2.1% 5401.JP (NIPPON STEEL): reportedly may offer up to $7B investment to preserve United States Steel deal

    • -1.2% 2328.HK (PICC Property & Casualty): ): reports FY results with IFRS net income attributable below FactSet estimates

    • -1.2% 883.HK (CNOOC): reports FY results with revenue below FactSet estimates

• Data:

  • Economic:

    • Japan March

      • Tokyo core CPI +2.4% y/y vs consensus +2.2% and +2.2% in prior month

        • CPI excl. fresh food & energy +2.2% y/y vs consensus +1.9% and +1.9% in prior month

        • Overall CPI +2.9% y/y vs consensus +2.7% and revised +2.8% in prior month

• Markets:

  • Nikkei: (679.64) or (1.80%) to 37120.33

  • Hang Seng: (152.20) or (0.65%) to 23426.60

  • Shanghai Composite: (22.44) or (0.67%) to 3351.31

  • Shenzhen Composite: (18.43) or (0.90%) to 2026.18

  • ASX200: 13.00 or +0.16% to 7982.00

  • KOSPI: (49.17) or (1.89%) to 2557.98

  • SENSEX: (290.41) or (0.37%) to 77316.02

• Currencies:

  • $-¥: (0.58) or (0.38%) to 150.4690

  • $-KRW: (1.36) or (0.09%) to 1464.0800

  • A$-$: (0.00) or (0.12%) to 0.6298

  • $-INR: (0.18) or (0.21%) to 85.4882

  • $-CNY: (0.00) or (0.04%) to 7.2623